In order to determine the objectives of the investment, it will be decisive that the profiles of the small and medium investors are clarified, as it probably will be in your case. Based on this important variable you can use one or the other strategy with which you try to make your savings profitable. Not surprisingly, it will not be the same as a retailer looking for the speculative moves in the financial markets, than those who only want to cement a savings bank for the future, even when their retirement arrives. Your treatment will be completely different.
To try to help you correctly channel your movements in equities, there will be no choice but to expose all the profiles that exist as an investor. There are not so many, as you can see. And in this way, you will check which group you really belong to. It will be a very useful strategy so that from now on you are in a position to optimize all operations in the stock market sector.
In order to determine a better position taking in the financial markets, the profile you present as a small and medium investor will be very relevant. It will be one of the keys that you have in your hands to improve the results of your operations. Both in fixed and variable income, or even from clearly alternative approaches or from other concepts in investment. It will be an element that you have of great help to channel operations in any financial asset. For this reason, you will have more reasons to take care of such an important part in your relationships with the world of money.
Investments: profiles of savers
It is the one who tries to protect his savings above all else, even the profitability that he can achieve. Your operations They are intended for the medium or long term, and almost always through very stable values, which maintain a daily volume in the contracting of their titles that is really important. Their shares do not usually show deviations in their prices above normal. In addition, they resist better the less favorable scenarios for equities.
Aggressive investors. It is the opposite case, where what it is about is to make profitable stock market movements in the shortest possible time. Its natural environment is short-term operations, and even in the same trading session. They are also characterized because they are very prone to perform many operations during the year. Although under some limits in its amounts. They do not invest all their savings in these operations. They are also usually the ones with the most experience to operate with these financial assets.
Intermediate profile. In this case, it assimilates some characteristics of the previous user groups. Not in vain do they try combine risk with protection of your savings. Although without ruling out any scenario. They are open to all the possibilities that the equity markets offer them, and sometimes they are not limited to the stock market, but they opt for other financial products. Mutual funds are one of his favorites, both in their equity and mixed models.
What about dividends?
The payment of dividends for some years now allows you two options. On the one hand, charge them directly and that they go to your checking account so you can do what you want with them. And on the other hand, the possibility of being able to reinvest them in the actions where you have taken positions. It will be a very personal decision that you will have to make after analyzing what you really want and what is the profile of a small investor that you present.
In any case, it will be convenient for you to know which are the scenarios where it is more favorable for you to invest this subscription that all shareholders receive. As a strategy for improve the status of your securities account. Not surprisingly, you can improve the margins that the bank provides you for dividends. Pay attention because it can be interesting every time this investment scenario occurs to you.
Dividends: bullish processes: when a stock market is experiencing a bullish process, you should reinvest the payment of dividends. The reason is because thanks to these operations you will have more shares, and therefore, greater possibilities that the yields increase. Instead of enjoying your liquidity. It will be a matter of having the money immobilized for a longer time. In exchange for an improvement in equity performance.
Long-term savings bags: if your investment is intended for the medium or long term, this movement will also be profitable. Not only will it allow you to increase your investment, but you will also be in a position to collect more money in the next dividends. Thus, you will increase your invested capital little by little. It is a very original way of creating a savings bag for the next few years. Not surprisingly, your approach is aimed at many years, even in the form of hereditary investment. It can be an excellent opportunity to raise your positions in the stock market.
Positions in very solid stocks
Another strategy can be developed in very stable values that rarely suffer significant falls in the stock market. It will be more worthwhile to integrate the dividends in the investment instead of not collecting them immediately. Especially if you are not going to need that money for a long time. In any case, you will have no choice but to consider time limits to close positions in equities. To prevent any downward movement in the markets from causing part of these gains to evaporate, in addition to the investment itself.
If you are a regular follower of the recommendations of financial analysts and intermediaries, you will have to get used to this term, of which you may not know its true meaning. It is the overweight in a security that is listed on the equity markets. Well, it applies when the prices of a company's shares are below the expectations of the analyzes. Therefore, it is a very common strategy among small investors to open positions in financial markets. Not surprisingly, it means that they have a long journey in their evolution in the stock market. In some cases, above double digits in profitability.
Overweight in the stock market
When they tell you that a security is overweight it is a clear signal that you can start your buying operations without excessive risks. Because in effect, it indicates that they are listed with significant discounts relative to your target price. Situation that you can take advantage of to make your savings profitable. Not without analyzing other parameters in your quote that will determine the decision you must make. Being overweight in most situations is an excellent opportunity to do good business in equity markets.
With all certainty that right now you are considering what are the reasons for this scenario. Well, on this incidence it is necessary that you know that the fact that a financial asset is below its estimated value can be due to many circumstances. One of the most important can be generated by being involved in a downtrend of great intensity.
Another, for merely temporary aspects of the company itself. And in a large part of the investment proposals, due to the low interest of investors who do not cover the demand for the shares. In any case, it is a very effective strategy for periods of permanence destined to the medium and long term. Where it is more profitable to carry out these operations over others.
Goals that you must meet
In any case, one of the most important phases of the investment process must be based on the objectives that you must formalize. The results should be based on the profiles that you present as a small and medium investor. In addition, the strategies you use to make your savings profitable will also influence. Because in effect, it is not the same aggressive approaches to others whose purpose is to preserve savings above all else. They are factors that you will have no choice but to abide by to determine the objectives of your operations in the equity and fixed income markets.
Well, as your lines of actions become more and more aggressive, the more expectations you will develop in the face of the income statement. It is something that is true in all scenarios, even the most unfavorable for the financial markets. Nor can you forget at any time about the protection measures that you should contribute to your investments. Through loss limit orders or partial sales to preserve your portfolio from depreciating in a short time.
Another of the purposes that you should consider from now on is to carry out a very detailed analysis of the candidates to make up your table of operations. Not surprisingly, this selection process will ultimately determine the income statement of your operations. In some cases it will be much more successful than in others. This is normal and common in any class of financial assets. So you will have to refine with your decision. Even if you need more time, you must give it to yourself to make the right decisions from the first moment. There is no doubt that if you follow all these tips, it will be much easier to achieve your goals. And even from broader earnings than up to now.